Airbus underscores the importance of its U.S. supplier base

Summary

U.S. suppliers will continue to play a vital supporting role in Airbus' jetliner production as the company manages its output in today's challenging market conditions and prepares for the global recovery that is to follow.

U.S. suppliers will continue to play a vital supporting role in Airbus' jetliner production as the company manages its output in today's challenging market conditions and prepares for the global recovery that is to follow.

Speaking to a capacity crowd at the Aero Club of Washington, D.C., Airbus Americas President and CEO Barry Eccleston said more U.S. parts and components are used on Airbus aircraft than from suppliers in France, Germany and the U.K. combined.

Airbus spent over $10 billion last year with suppliers in the U.S., Eccleston added, positioning America as the company's largest single supplier country anywhere in the world. This business accounted for 190,000 high-paying, high-technology American jobs across 40 states.

"Ours is a global industry, and as long as we continue to have a level playing field with fair and free open market access, Airbus can maintain its development on a global basis," he told the Aero Club luncheon audience of industry executives, government officials, association managers and other guests. "As a result, we will be able to further develop our activity and partnership with all of our U.S. suppliers."

Despite the current global financial crisis, Airbus has an unprecedented backlog of approximately 3,500 aircraft to build - representing between six and seven years of production. Eccleston called this "a tremendous pillar of strength" to work with during the recession, and ensures work for its industrial suppliers over the long term.

"Not only is this backlog large, it is geographically diverse - with over 50 percent in the developing regions of China, Southeast Asia, India, the Middle East, Latin America and Africa. These are areas that are actually still growing, or are turning around for quick growth," he said. "So the strength of our backlog is not only in numbers, but it's also in quality - particularly on a geographical basis."

Airbus is carefully managing its backlog, taking steps that include monitoring the customers' financial health, deferring some deliveries and moving others ahead to meet the airlines' varying needs, and working with both banks and credit agencies on financing solutions.

While Airbus has adjusted the output of its A320 single-aisle aircraft family and decided not to further accelerate the manufacturing rate for A330/A340 widebody jetliners, Eccleston urged U.S. suppliers not to "get ahead of Airbus" in further adjusting the output of aircraft parts and components on their own.

"We have to balance the airlines' needs and the rates at which we build our airplanes with the requirement to continue our quality production, while maintaining a quality workforce and a quality supply base," Eccleston told the Aero Club luncheon audience. "So we don't want to build down the production rate, and we don't want our suppliers to do that. So when we say this is the rate we need, it indeed is the rate we need. I hope that our suppliers will respect and understand this."

In the photo above, Airbus Americas President and CEO Barry Eccleston receives a commemorative plaque following his speech to the Aero Club of Washington, D.C., which was presented by Jim Bennett, club president (at right).